Health Plan Weekly

CMS on April 30 finalized part two of the annual omnibus rule governing the Affordable Care Act (ACA) exchanges, using the opportunity to roll back a few parts of the regulation that the Trump administration didn’t cement before leaving office.

In January, the Trump administration finalized the most controversial sections of the 2022 Notice of Benefit and Payment Parameters (NBPP), including provisions that codified unprecedented waiver flexibilities and those that invited states to ditch a centralized health insurance marketplace. The Biden administration won’t be able to roll those back without restarting the rulemaking process, yet it used this most recent rule (86 Fed. Reg. 24140, May 5, 2021) to signal that such a move is coming soon.

✦ CMS on April 30 released the second half of the 2022 Notice of Benefit and Payment Parameters for the Affordable Care Act exchanges, which cuts consumers’ out-of-pocket costs by $400 annually. The Trump administration finalized the first phase of the omnibus rule that sets parameters for ACA exchange plans just days before President Joe Biden’s inauguration. The second phase of the rule also “includes several provisions to help consumers more easily distinguish between plan options and increase opportunities to qualify for future special enrollment periods,” according to the Biden administration. Read more at https://go.cms.gov/3eMwudB.

✦ Included in President Joe Biden’s $1.8 trillion antipoverty package, the American Families Plan, is a proposal to make the expanded Affordable Care Act exchange subsidies permanent. The administration’s COVID-19 relief legislation enacted in March increased premium tax credits for people who already qualify for financial help and made subsidies available to people who previously didn’t qualify — but the expanded subsidies were set to expire after 2022. In his address to Congress on April 28, Biden called for health care reforms such as allowing the government to negotiate drug prices and reducing deductibles for ACA marketplace plans, but those are not included in his new legislative proposal. Visit https://bit.ly/3aPQjzm.

Humana Inc. plans to fully acquire home health provider Kindred at Home from private equity firm Welsh, Carson, Anderson & Stowe (WCAS) and TPG Capital, the insurer said on April 27. (WCAS owns a controlling stake in MMIT, AIS Health’s parent company.) The insurer also reported strong financial results, with first-quarter adjusted earnings per share (EPS) of $7.67 beating Wall Street’s projected consensus of $7.07, or $1.04 billion in pretax income.

Humana CEO Bruce Broussard said during an April 28 call with investors discussing the firm’s first-quarter results that the Kindred acquisition “will enable us to more closely align incentives to focus on improving patient outcomes, and on reducing the total cost of care.”

Centene Corp.’s two dominant business lines — managed Medicaid and the Affordable Care Act exchanges — both were sources of significant headwinds and tailwinds in the first quarter of 2021, underscoring the often-contradictory impact of the COVID-19 pandemic on the health insurance sector.

On the one hand, Centene acknowledged in its earnings report that it saw higher COVID-19 and traditional utilization in its ACA marketplace business, surprising Jefferies analysts who noted that “those components have tended to move in opposite directions.” Centene also saw its marketplace membership decline year over year by 14%, the analysts noted.